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In what ways is Publix stronger? Let us count the ways

Published: Tuesday, February 26, 2013 at 1:00 a.m.

Last Modified: Monday, February 25, 2013 at 8:40 p.m.

LAKELAND - Publix Super Markets Inc., scheduled to release its 2012 financial results Friday, should see another year of aggressive growth in the cutthroat retailing business, analysts say.

The Lakeland-based chain, which declined to comment for this story, made its debut in the Knoxville, Tenn., market in 2012 and announced an expansion into North Carolina, the first such move since Publix entered Tennessee more than a decade ago.

Publix also continued to experiment with its store formats -- including a new prototype in Longboat Key -- and began testing an online deli ordering system in select spots. More recently, the chain has deepened its push into social media by formally joining Twitter. The chain also is in the process of rolling out a digital coupon system across all stores.

The company reported a 6.1 percent increase in profits during the first nine months of 2012, at $1.2 billion. Sales through the third quarter increased 3.9 percent to $20.5 billion.

"Publix is sitting really good right now. They've stayed focused," said David Livingston, a Wisconsin-based supermarket analyst and consultant with DJL Research. "They're sitting back and waiting for the other competitors to make mistakes."

Publix is a rare example of a traditional supermarket chain still thriving in Florida, Livingston said. Albertsons shuttered most of its remaining Florida stores last year, and Tampa-based Sweetbay has closed 33 around the state, leaving the company with 72 stores.

Though general retailers such as Target have been adding fresh foods, and chains such as Whole Foods are slowly expanding in Florida, Livingston does not expect them to be much of a threat to Publix.

"I think Publix is trying to be very competitive on their high-volume items. They don't have to have the lowest prices ... they don't have much to worry about Walmart," Livingston said. "This is one company that's been able to grow and thrive since Walmart came into the market, and they've used Walmart as muscle to drive out the other competitors.

Expansion continues

Jon Springer, retail editor for Supermarket News, said Publix is one of the companies that "has consistently been growing organically in new markets."

He says Publix is making a bold move with its expansion into the Charlotte, N.C., market -- with the first store scheduled to open in early 2014.

Springer noted that one competitor in the area, Matthews, N.C.-based Harris Teeter, is considering a possible sale, which might create opportunities for Publix as the grocer gets settled in Charlotte, Springer said.

Springer said in 2013, Publix and other supermarkets could see shoppers cutting back if food inflation becomes an issue.

"If you're paying more for chicken and beef, you have less left over for other things in the store," he said.

The supermarket industry also could be affected by the payroll tax increase that went into effect this year, said Meg Major, editorial director for Progressive Grocer.

"The payroll tax is definitely going to be a trend, I think, certainly in these first quarter numbers for all retailers. It's going to impact discretionary spending in supermarkets," Major said. "At the same time, gas prices are surging, upwards of 50 cents in the past 30 days. Cost of fuel also is a big factor in discretionary purchases."

New and better stores

Major and another analyst said it bodes well for Publix that the chain has continued to revamp its older stores and cater to shoppers' demands for offerings such as prepared foods.

"It's very critical for grocers these days to keep their stores fresh and modern, updated with all of the specific departments customers are looking for," Major said.

Pat Fitzpatrick, president of Atlanta Retail Consulting, agreed, noting the December re-opening of the remodeled Publix "prototype" on Longboat Key that features unique product displays, indoor and outdoor dining areas, and an expanded selection of specialty items and organic foods.

Publix reportedly also will replace a store in Tampa's Carrollwood area with a new model that featuring a sit-down coffee shop and a large organic foods, specialty cheeses and body-care items.

That kind of effort should help Publix stay in touch with more adventurous shoppers, Fitzpatrick said. Similar concepts have worked well for Whole Foods.

"Publix is obviously experimenting with and trying to find a format -- as every successful retail organization does -- that will continue to add zest and appeal to the brand name," he said.

<p><em>LAKELAND</em> - Publix Super Markets Inc., scheduled to release its 2012 financial results Friday, should see another year of aggressive growth in the cutthroat retailing business, analysts say.</p><p>The Lakeland-based chain, which declined to comment for this story, made its debut in the Knoxville, Tenn., market in 2012 and announced an expansion into North Carolina, the first such move since Publix entered Tennessee more than a decade ago.</p><p>Publix also continued to experiment with its store formats -- including a new prototype in Longboat Key -- and began testing an online deli ordering system in select spots. More recently, the chain has deepened its push into social media by formally joining Twitter. The chain also is in the process of rolling out a digital coupon system across all stores.</p><p>The company reported a 6.1 percent increase in profits during the first nine months of 2012, at $1.2 billion. Sales through the third quarter increased 3.9 percent to $20.5 billion.</p><p>"Publix is sitting really good right now. They've stayed focused," said David Livingston, a Wisconsin-based supermarket analyst and consultant with DJL Research. "They're sitting back and waiting for the other competitors to make mistakes."</p><p>Publix is a rare example of a traditional supermarket chain still thriving in Florida, Livingston said. Albertsons shuttered most of its remaining Florida stores last year, and Tampa-based Sweetbay has closed 33 around the state, leaving the company with 72 stores.</p><p>Though general retailers such as Target have been adding fresh foods, and chains such as Whole Foods are slowly expanding in Florida, Livingston does not expect them to be much of a threat to Publix.</p><p>"I think Publix is trying to be very competitive on their high-volume items. They don't have to have the lowest prices ... they don't have much to worry about Walmart," Livingston said. "This is one company that's been able to grow and thrive since Walmart came into the market, and they've used Walmart as muscle to drive out the other competitors.</p><p>Expansion continues</p><p>Jon Springer, retail editor for Supermarket News, said Publix is one of the companies that "has consistently been growing organically in new markets."</p><p>He says Publix is making a bold move with its expansion into the Charlotte, N.C., market -- with the first store scheduled to open in early 2014.</p><p>Springer noted that one competitor in the area, Matthews, N.C.-based Harris Teeter, is considering a possible sale, which might create opportunities for Publix as the grocer gets settled in Charlotte, Springer said.</p><p>Springer said in 2013, Publix and other supermarkets could see shoppers cutting back if food inflation becomes an issue.</p><p>"If you're paying more for chicken and beef, you have less left over for other things in the store," he said.</p><p>The supermarket industry also could be affected by the payroll tax increase that went into effect this year, said Meg Major, editorial director for Progressive Grocer.</p><p>"The payroll tax is definitely going to be a trend, I think, certainly in these first quarter numbers for all retailers. It's going to impact discretionary spending in supermarkets," Major said. "At the same time, gas prices are surging, upwards of 50 cents in the past 30 days. Cost of fuel also is a big factor in discretionary purchases."</p><p>New and better stores</p><p>Major and another analyst said it bodes well for Publix that the chain has continued to revamp its older stores and cater to shoppers' demands for offerings such as prepared foods.</p><p>"It's very critical for grocers these days to keep their stores fresh and modern, updated with all of the specific departments customers are looking for," Major said.</p><p>Pat Fitzpatrick, president of Atlanta Retail Consulting, agreed, noting the December re-opening of the remodeled Publix "prototype" on Longboat Key that features unique product displays, indoor and outdoor dining areas, and an expanded selection of specialty items and organic foods.</p><p>Publix reportedly also will replace a store in Tampa's Carrollwood area with a new model that featuring a sit-down coffee shop and a large organic foods, specialty cheeses and body-care items.</p><p>That kind of effort should help Publix stay in touch with more adventurous shoppers, Fitzpatrick said. Similar concepts have worked well for Whole Foods.</p><p>"Publix is obviously experimenting with and trying to find a format -- as every successful retail organization does -- that will continue to add zest and appeal to the brand name," he said.</p><p><empty></p>